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Replication data for: Investment Behavior, Observable Expectations, and Internal Funds

Resource Type
  • Cummins, Jason G.
  • Hassett, Kevin A.
  • Oliner, Stephen D.
Publication Date
  • Abstract

    We use earnings forecasts from securities analysts to construct a new measure of the neoclassical fundamentals that drive investment spending. We find that investment responds significantly to our new measure of fundamentals but is insensitive to cash flow, even for firms typically thought to be liquidity constrained. These results have two key implications. First, fundamentals may be more important for investment spending than would be suggested by the results to date from investment-q models. Second, the positive cash-flow effects obtained in such models may reflect a failure to control properly for fundamentals rather than the presence of financial constraints. (JEL: D92, E22)
  • Is supplement to
    DOI: 10.1257/aer.96.3.796 (Text)
  • Cummins, Jason G, Kevin A Hassett, and Stephen D Oliner. “Investment Behavior, Observable Expectations, and Internal Funds.” American Economic Review 96, no. 3 (May 2006): 796–810.
    • ID: 10.1257/aer.96.3.796 (DOI)

Update Metadata: 2020-05-18 | Issue Number: 2 | Registration Date: 2019-12-07

Cummins, Jason G.; Hassett, Kevin A.; Oliner, Stephen D. (2006): Replication data for: Investment Behavior, Observable Expectations, and Internal Funds. Version: V0. ICPSR - Interuniversity Consortium for Political and Social Research. Dataset.